What is a default notice?
A default notice is a formal letter from a lender saying you've broken your credit agreement, usually by missing payments. By law it must give you at least 14 days to put things right. If you pay what it asks by the date on the notice, it's treated as if you never broke the agreement. If you can't, the lender can close the account and record a default on your credit file, where it stays for 6 years.
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A default notice is a formal letter from a lender saying you've broken your credit agreement, usually by missing payments. By law it must give you at least 14 days to put things right. If you pay what it asks by the date on the notice, it's treated as if you never broke the agreement. If you can't, the lender can close the account and record a default on your credit file, where it stays for 6 years.
Written by Nathan Deeble, OneLetter founder · How we check this · Last reviewed: September 2026 · Checked against gov.uk · Information only, not legal advice
Default notice: the essentials
- What it is
- A formal warning under the Consumer Credit Act 1974
- Time to act
- At least 14 days after the notice is served (see the date on it)
- Pay the arrears in time
- Treated as if the agreement was never broken
- If you can't
- The account can be closed and the full balance asked for
- Credit file
- A default stays for 6 years from the default date, even if you pay it off
- Applies to
- Credit and store cards, personal and payday loans, hire purchase
What a default notice must tell you
- What you've done that breaks the agreement, usually the payments you've missed and how much
- What you need to do to put it right, and the date you need to do it by
- What will happen if you don't
- It must come with an information sheet about arrears and default, which explains where to get free help
The date must be at least 14 days after the notice is served. If yours gives you less time, or leaves any of this out, it may not be valid, so it's worth getting free advice before you do anything else.
Default notice, arrears notice or 'notice of default sums': which have I got?
- A notice of sums in arrears is an earlier letter, usually sent after you've missed two payments. It tells you you're behind, but it isn't a default and has no deadline.
- A notice of default sums tells you the lender has added charges, such as late payment fees, because you've missed payments.
- A default notice is the formal one with a deadline. This is the letter to act on before the date it gives.
What happens if I can't pay by the date?
The lender can end the agreement, ask for the whole balance, and record a default on your credit file. Later they may pass the account to a debt collector or sell it, and they could eventually take you to court. A default isn't a court judgment, and nothing has gone to court yet. The best thing you can do is contact the lender before the date, explain what you can afford, and ask for a payment arrangement. Lenders have to treat people in financial difficulty fairly. In England and Wales, a free debt adviser can also apply for Breathing Space, which pauses most interest, charges and enforcement action for 60 days while you get your finances in order.
How a default affects your credit file
A default stays on your credit file for 6 years from the date of default, whether or not you pay it off. Paying it marks it as satisfied, which looks better to lenders than an unpaid default, and after 6 years it drops off completely. Check your credit file with the credit reference agencies to make sure the default date and amount are right. If they're wrong, you can ask for them to be corrected.
What about mortgages?
Most mortgages on your home aren't covered by the Consumer Credit Act, so they don't use this kind of default notice. Mortgage arrears follow different rules, and lenders have to follow set steps before they can go to court. If you're behind on your mortgage, speak to your lender and get free debt advice as soon as you can.
What happens if you ignore it?
If the date on the notice passes without payment or an agreed plan, the account will usually default. That means a mark on your credit file for 6 years, the full balance becoming due, and the debt possibly being passed to a collector. If it's still unpaid after that, the lender could send a letter before claim and then start a county court claim. Acting before the date on the notice is the cheapest and easiest point to sort it out.
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See what your letter means, freeFrequently asked questions
How long do I have after a default notice?
At least 14 days after it was served. The exact date is written on the notice. Paying the arrears it asks for by that date means the default is treated as if it never happened.
Will paying off a default remove it from my credit file?
No. It stays for 6 years from the default date, but it will show as satisfied, which lenders see as better than an unpaid default.
Is a default notice a court letter?
No. It comes from the lender, not a court. Court action can only start later, and a lender has to send a letter before claim first.
What if I can't afford to pay the arrears?
Contact the lender before the date and ask for an affordable arrangement, or get a free debt adviser to do it for you. You can also ask about Breathing Space.
Official sources & free help
For the full detail, and free, independent advice, see: